ABSTRACT
Kamakura Ironworks is a family-run firm located in Tochigi-ken, a distant suburb of Tokyo. The firm was founded in 1910 as a blacksmith shop; it was incorporated in 1950 as the Kamakura Ironworks Company, Ltd., with capitalization of only ¥200,000. Kamakura specialized in producing low-volume products. This strategy was adopted because most of the firm's customers could produce forgings in high volumes in-house. Large customers placed heavy pressure on Kamakura to become more efficient and reduce its selling prices. Several customers, especially those in the automobile industry, required that Kamakura reduce its selling prices from 1% to 5% per year. Kamakura had also introduced a preventative maintenance program designed to focus employee attention on reducing the cost of equipment maintenance. As part of this program, every worker was expected to make at least one maintenance reduction suggestion each month.
